Because Rapgenius hasn't profited out of the lyrics yet. DMCA focused on monetization of other people's content as one of the main criterias for violation. It doesn't matter whether it's UGC or not.
You, and the people replying to you, are pulling this out of thin air. The words "profit", "money" and "commercial" never appear anywhere in the bill. No aspect of the safe harbor rules hinge on monetization. On the other hand, the one thing you said that doesn't matter (that it's UGC), is the #1 requirement for protection. http://www.aclu.org/technology-and-liberty/text-digital-mill...
Case in point: YouTube contains tens of millions of copyright infringing videos. YouTube runs ads on these videos. YouTube was sued for hosting these infringing videos (Viacom v YouTube). YouTube did host the infringing material, and profit from it; that was undisputed. It was found not liable for that infringement because of the DMCA.
If I recall, this is basically the surest way to lose your DMCA protection. The key is for them to prove that you knowingly profited from the copyright infringement. Another issue is what percentage of your service is legit/infringing.
As much as people hated it at the time, the DMCA is a pretty reasonable law (which is why the bad guys at various companies are trying to replace it).
The DMCA has no such consideration of profiting from infringement or the percentage of the service that is legitimate versus infringing. A service that contains nothing but infringing content, and puts ads on every page hosting that content, can be completely free from liability for the infringement. No need to speculate based on bits and pieces you think you've heard places -- read the bill! It's short, it's not hard to read, and it's something you should know given your profession.
This is common and incorrect view of the legal system in the US. The law as it is written is only half of the picture. You need to understand the relevant case law to have any idea how a judge might actually rule on a given case. This is one reason why attorneys make so much money.
Taking in a 15 million dollar funding round, while not considered profit, does seem to fall into a subjective consideration of "profiting from the lyrics".
If their site had no lyrics, they would have no traffic and as a result no funding.
Case in point: YouTube contains tens of millions of copyright infringing videos. YouTube runs ads on these videos. YouTube was sued for hosting these infringing videos (Viacom v YouTube). YouTube did host the infringing material, and profit from it; that was undisputed. It was found not liable for that infringement because of the DMCA.